Hi! I am having difficulty with the calculations, numbers used, to get to the balance of the Cash paid to suppliers and employees section of my statement of cash flows. The numbers have to add up to 964,264 as is shown on the statement of cash flows for that part of operating activities. I found the cash flow statement on course hero but now have to show how to calculate each balance for each part of the statement. I have attached all financial statements and adjusting journal entries, along with the excel spreadsheet I am working on to show the calculations for my work. Thank you for your help! My phone number is 740-405-7154 if need be and my name is Sandra.

Independent Accountant's Review Report Board of Directors Hydromaint, Inc. 526 Court Street St. Louis, MO 63110 We have reviewed the accompanying balance sheet of Hydromaint, Inc. as of December 31, 20X3 and 20X2, and the related statements of comprehensive income, changes in stockholders' equity and cash flows for the years then ended. A review consists principally of inquiries of company personnel and analytical procedures applied to financial data. It is substantially less in scope than an audit in accordance with generally accepted auditing standards, the objective of which is the expression of an opinion regarding the financial statements taken as a whole. Accordingly, we do not express such an opinion. The management of Hydromaint, Inc. is responsible for the financial statements and for internal control over financial reporting. All information included in these financial statements is the representation of the management of Hydromaint, Inc. The accountant's responsibility is to conduct the review in accordance with Statements on Standards for Accounting and Review Services issued by the American Institute of Certified Public Accountants. These standards require the accountant to perform the procedures to obtain limited assurance that there are no material modifications that should be made to the financial statements. We believe that the results of our procedures provide a reasonable basis for our report. Based on our review, we are not aware of any material modifications that should be made to the accompanying financial statements in order for them to be in conformity with accounting principles generally accepted in the United States of America. Coe & Lane, CPA's Riverfront Plaza, Suite 2200 St. Louis, MO 63101 January 31, 20X4 HYDROMAINT, INC. NOTES TO FINANCIAL STATEMENTS FOR THE YEARS ENDING DECEMBER 31, 20X3 AND 20X2 Note 1--Summary of Significant Accounting Policies a. Accounting Method: The financial statements are prepared in accordance with the Generally Accepted Accounting Principles (GAAP) of the United States. As such, management is required to make estimates and assumptions that affect the reported amounts of assets, liabilities, revenues, and expenses and disclosure of contingent assets and liabilities. Actual results may differ from those estimates and assumptions. b. Subsequent Events: In accordance with ASC 855, the Company has evaluated subsequent events through January 31, 20X4, which is the date the financial statements were issued. It was determined that the Company was not in compliance with the loan covenants on the Note Payable as of year-end due to the new lease and the underfunded defined benefit pension plan. With the approval of the Bank, the Company made a contribution to the pension trustee on January 30, 20X4 that resulted in compliance with all loan covenants. There are no other subsequent events that would have a material effect on the financial condition of the Company. c. Revenue Recognition: Service revenue is recorded as services are performed on contract. In accordance with ASC 605-10-25-1, the Company recognizes revenue when all of the following criteria are met: persuasive evidence of an arrangement exists, delivery has occurred, the price is fixed or determinable, and collectability is reasonably assured. d. Accounts receivable: Accounts receivable are recorded at their original carrying value less allowances for estimated uncollectible accounts. e. Trading securities: Trading securities represents marketable equity securities that are actively traded by the Company. These securities are reported at fair value based on quoted market prices or dealer quotes. Unrealized market gains and losses are included in net income. f. Securities Available for Sale: Securities Available for Sale represent marketable equity securities that are not actively traded, but are held with the intent of earning dividend income. These securities are reported at fair value based on quoted market prices or dealer quotes. Unrealized market gains and losses are held in Accumulated Other Comprehensive Income until realized in accordance with ASC 320-10-45-9. g. Merchandise Inventory: Merchandise is stated at lower of cost or market. The Company uses the first-in first-out inventory method to determine cost. h. Supplies on Hand: Supplies on hand are stated at cost, which does not exceed market. The Company uses the first-in first-out inventory method to determine cost. i. Prepaid insurance: Prepaid insurance consists of a one-year insurance policy that will expire in 20X4. j. Property, Plant, and Equipment: Property, plant, and equipment are stated at cost and depreciation is computed using the straight-line method at rates based upon the estimated useful lives of the assets. The major classes of assets owned by the Company follow: Equipment Vehicles Capital LeaseBuilding 7 years 6 years 20 years Expenditures for repairs and maintenance are charged to expense as incurred. Expenditures for major renewals and betterments, which significantly extend the useful lives of existing plant and equipment, are capitalized and depreciated. k. Licensing Agreement: The licensing agreement is stated at cost less accumulated amortization. The license is amortized using the straight-line method over the fifteen year life of the license agreement. l. Income Taxes: Income tax expense includes taxes currently payable and those deferred because of temporary differences between the financial statement and tax bases of assets and liabilities. The deferred income tax classified under Current Assets represents temporary differences relating to current assets and liabilities. The deferred income tax classified under Long Term Assets/Liabilities represents temporary differences relating to noncurrent assets and liabilities. m. Earnings per Share Earnings per share is calculated by dividing net income available to common stockholders by the weighted average shares outstanding during the year. Weighted average shares outstanding during the year were 14,000 in both 20X3 and 20X2. n. Retirement Plan: The Company has a noncontributory, defined benefit retirement plan covering all employees. Retirement benefits represent a form of deferred compensation which is subject to change due to changes in assumptions. Management reviews underlying assumptions on an annual basis. The Company has chosen to provide pension benefit disclosures required for public entities as contained in Note 7. o. Warranties: The Company offers a three year warranty on all inventory sold. Warranty expense is estimated based on cost trends and industry averages and is recorded in the year of the sale. p. Comprehensive Income: Comprehensive income provides an inclusive financial reporting method for any non-owner changes in equity not included in the calculation of net income. The Company reports Comprehensive Income and Accumulated Other Comprehensive Income which encompasses net income, unrealized gains on securities available for sale, and unamortized prior service cost related to the retirement plan. Information regarding Accumulated Other Comprehensive Income and Comprehensive Income is included in the Statement of Comprehensive Income in accordance with ASC 220-10-45. Note 2Note Payable On February 1, 20X2, the Company borrowed $312,000 at a fixed interest rate of 6.5 percent. Proceeds from the note were used to finance vehicles. The terms of the note require four payments of $91,074 annually on February 1, beginning in 20X3. The note is secured by the vehicles and loan covenants require a minimum current ratio and a maximum long-term liabilities-to-equity ratio and restrict payment of dividends, increases in officers' salaries, and loans to officers. The Company is in compliance with the loan covenants, with the exception of the long-term liabilities-to-equity ratio, at year end 20X3. The long-term liabilities-toequity ratio was 1.15, due to the new capital lease (Note 3) and the new underfunded defined benefit pension plan (Note 7). The covenants require this ratio to be less than 1.0. After discussions with the Bank, the Company made a deposit to the pension trustee on January, 30, 20X4, which resulted in the Company being in compliance with the loan covenant requirements as of that date. The Bank was satisfied with this arrangement. Interest of $20,280 was paid on this note in 20X3. No interest was paid in 20X2. Note 3--Leases and Other Commitments The company leases its building and shop facilities under a 20 year capital lease agreement, and leases equipment under operating leases. Assets held under capital leases are included in Property, Plant and Equipment and are charged to depreciation and interest over the life of the lease. Related liabilities are included in Current Liabilities and Long-Term Liabilities. No interest was paid on this lease in 20X3. Operating leases are not capitalized and lease payments are expensed over the life of the lease. An analysis of the 20X3 and 20X2 rent expense by property leased follows: Future minimum lease commitments for all non-cancelable leases as of December 31, 20X3 are as follows: Note 4--Information about Major Customers The Company's source of revenue was composed of 14 maintenance contracts during 20X3 and nine contracts during 20X2. Five contracts qualify as major customers in accordance with ASC 280-10-50-42 in 20X3 and individually provided a range of 10 to 11 percent of total service revenues earned. Five customers each provided a range of 10 to 16 percent of service revenues earned during 20X2. Note 5Income Taxes Income tax payments were $192,662 and $0 in 20X3 and 20X2, respectively. The effective tax rate for 20X3 is 29.87% due to a dividends-received deduction, and for 20X2 is 29.56% due to the change in accounting estimate related to the valuation allowance recorded in 20X1. Note 6 - Fair Value of Financial Instruments The following methods and assumptions were used to estimate the fair value of each class of financial instruments for which it is practicable to estimate that value: Cash: The carrying amount approximates fair market value because of the short maturity of the instruments. Trading securities: Fair value for the short-term equity securities is determined by the market value of the investments at the balance sheet date. Securities available for sale: Fair value for the long-term equity securities is determined by the market value of the investments at the balance sheet date. Note payable: The fair value of the Company's note payable is estimated based on the quoted market prices for the same or similar issues or on the current rates offered to the Company for debt of the same remaining maturities. The estimated fair values of the Company's financial instruments are as follows: Note 7 - Defined Pension Plan In 20X3, the Company implemented a defined benefit plan covering all employees. Plan assets are invested in corporate stocks (35%), corporate bonds (20%), and government bonds (45%). Prior service cost of $19,525 will be expensed in 20X4. Note 8Accumulated Comprehensive Income The remaining unamortized prior service cost and corresponding deferred tax benefit will be amortized to pension expense over the next nine years, in accordance with ASC 715- 20-50. The accumulated unrealized holding gain and corresponding deferred tax will be recognized in income when realized, in accordance with ASC 320-10-45-9. Note 9--Reconciliation of Net Income (Loss) to Net Cash Flows from Operating Activities The schedule showing the reconciliation of net income for 20X3 and 20X2 to the net cash flows from operating activities in accordance with ASC 230-10-45-30 is presented below: HYDROMAINT, INC. STATEMENT OF CASH FLOWS FOR THE YEAR ENDING DECEMBER 31, 20X3 Operating Activities: Cash receipts from customers Cash payments to suppliers Cash payments for selling and administrat tve expenses Cash received from investments Cash payments for interest expense Cash payments for income tax expense Cash payment for trading securites Net cash used by operations 2013 1,966,368 (964,264) (521,580) 3,650 (17,745) (192,662) (40,500) 233,267 2012 1,181,000 (547,853) (238,165) 394,982 WORKING CALCULATIONS Cash Receipts from Customers Net Sales 2,010,200 Unearned Revenue 86,000 Beg A/R 122,000 End A/R (251,832) Total 1,966,368 Cash Payments to Suppliers ;l Total 964264 Cash Payments for Selling and Admin Selling and Admin Insurance Selling and Admin Building Rental Various selling and Admin Expenses Selling and Admin Utlites Selling and Admin Medical Benefits Selling and Admin Pension Expense Prepaid Insurance Total -3033 -2167 -239174 (7,140) (38,000) (232,000) (66) (521,580)